Programme for Government 2016 to 2017

The Scottish Government's Programme for Government 2016 to 2017 sets out the actions we will take in the forthcoming year and beyond.

This document is part of a collection

2 Growing a Productive, Sustainable Economy With More Jobs and Fair Work

Keith Brown MSP. Cabinet Secretary for the Economy, Jobs and Fair Work

Keith Brown MSP. Cabinet Secretary for the Economy, Jobs and Fair Work

Scotland's economy has steadily improved across a range of indicators since the recession of 2008 and 2009 and we now have a resilient platform for long-term growth and employment - there are now 65,000 more people in employment in Scotland than the pre-recession high.

Continued economic recovery is, of course, threatened by the outcome of the EU referendum. Ahead of any action by the UK Government, we have acted decisively to counter this economic uncertainty by launching a £100 million capital stimulus package and a new Post-Referendum Business Network to provide advice and support at this challenging time.

Despite the uncertainty our purpose of creating a more successful country, with opportunities for all Scotland to flourish through increasing sustainable economic growth remains central to our approach. The four priorities set out in the Government's Economic Strategy are vital to our approach to growing an inclusive economy: Investing in our people, infrastructure and assets; fostering a culture of Innovation; promoting Inclusive growth; and supporting Internationalisation.

A more competitive and inclusive economy will ensure Scotland can withstand economic shocks, sustain higher employment, and create better quality jobs and fairer work.

In this Parliament, we will implement a nationwide drive to improve our long-term economic and productivity growth, building on strong foundations across Scotland's towns and cities and rural and island communities which host some of the country's most important economic sectors, among them tourism, food and drink, fisheries and agriculture.

A genuinely sustainable Scottish economy, with high-speed broadband connectivity extending to every corner of the country, rests on two imperatives. The first is tackling social exclusion to ensure there is a broad economic contribution from every section of society in every area of Scotland. The second is driving decarbonisation of our economy more quickly than our competitors, developing the low carbon products and services that will be needed throughout the world in the future and creating new job opportunities.

Scotland's natural environment worth more than £20 billion per annum supports more than 60,000 jobs

Our inclusive economic approach is the hallmark of the Government's Economic Strategy and in this Parliament we will invest in our people, infrastructure and assets across all our communities. Scotland is rich in natural capital. Developing and managing these resources well is vital to supporting a vibrant and strong economy, particularly in rural areas. Currently Scotland's natural environment is worth more than £20 billion per annum and it supports more than 60,000 jobs. Unlocking opportunities will help provide jobs and sustain services in many rural and coastal communities around Scotland including new opportunities for marine-related growth and wider rural business.

We are also acting to protect our assets and decarbonise our economy. The Government's commitment to addressing climate change will be a prominent theme in this Parliament. Our Climate Change Plan and an accompanying Energy Strategy will be published this winter, outlining our intention to reduce Scottish emissions by 80% between 1990 and 2050. This represents a bold statement of the Government's priorities for the coming decades. In early 2017 we will outline proposals for a new Climate Change Bill to reduce emissions further.

We will continue to support major investment across our communities, as we have done since 2007, to modernise infrastructure, driving substantial improvements in our transport, energy, digital and water networks as well as providing a boost to the economy. Over this Parliamentary term, another £20 billion will be invested in public infrastructure, boosting long-term productivity growth, supporting steps to decarbonise the Scottish economy and providing vital support for our construction and service sectors.

Our infrastructure investment will also bring direct benefits to our communities with more than £3 billion for affordable housing supply over the life of this Parliament, delivering at least 50,000 homes with 35,000 of them for social rent. We will work in partnership with local authorities to invest more than £572 million in the coming year. Our new Scotland's Energy Efficiency Programme ( SEEP) will start in 2018 with accompanying regulation to improve the energy efficiency of the building stock over the long-term, helping reduce energy costs and tackling fuel poverty.

Innovation - the main driver of long-term productivity growth - will be supported with continued investment in our world-class higher education. In the coming year, we will modernise enterprise and skills support as we work towards moving our productivity from the third quartile of the Organisation for Economic Co-operation and Development ( OECD) nations to the top quartile.

In the post- EU referendum period, growing Scotland's trade links has never been more important and we will take steps to grow our export links and attract inward investment, including new innovation and investment hubs in Brussels, Dublin and London.

We will also invest in our most important asset - our people. Our recently published Labour Market Strategy sets out a clear strategic direction for how we plan to create and support jobs. In particular, it sets out the importance of fair working practices, including payment of the Living Wage, in driving increased innovation in workplaces. With the Fair Work Convention we will continue to make the positive case for how a more progressive relationship between employers, employees and their representatives can increase productivity and growth in a way that is inclusive and fair.

We will invest over £3 billion in affordable housing supply over the next parliament, delivering at least 50,000 homes with 35,000 of them for social rent

Reduce Scottish emissions by 80%
between 1990 and 2050

Programme detail

Capital stimulus

In August the First Minister announced that capital spending on projects to support and create employment was being accelerated, starting with an additional £100 million of funding in this financial year. The capital funding is being used to speed up delivery of health and other infrastructure projects. As well as the initial £5 million for the Golden Jubilee Hospital to bring expansion of its elective centre forward from 2018-19 to this year, the following projects have been selected because of the early benefits they offer to the Scottish economy:

  • £10 million for domestic energy efficiency measures - helping make our homes cheaper to heat and reducing the costs of energy bills for householders
  • £10 million to make our public sector buildings more energy efficient - creating and safeguarding jobs as well as ensuring long-term savings to the public purse
  • £1.3 million to support Higher Education research, securing match-funding from the UK Government
  • £3.13 million on rail projects (including wi-fi and air conditioning improvements, passenger counting equipment, ticket vending machines and ticket office at Blairhill)
  • £0.5 million on supporting business access to the Digital Internet Exchange
  • £10 million to support the delivery of capital projects for local economic development
  • £0.57 million for Clyde Gateway by supporting the Dalmarnock Industrial Park power upgrade
  • £23 million to support the maintenance of the Higher Education estate across Scotland (that we expect to be match-funded by the sector)
  • £15 million towards trunk road maintenance
  • £10 million to support the maintenance of the Further Education estate across Scotland
  • £3.5 million for refurbishment of Inverclyde Hospital and Glasgow Royal Infirmary
  • £2 million for Scottish Fire and Rescue Service estate maintenance
  • £2 million to improve the Police Scotland estate maintenance
  • £2 million for Scottish Courts and Tribunals Service estate maintenance
  • £2 million for Historic Environment Scotland investment in properties in care

This spending will deliver a vital boost to the economy, helping retain skills and activity in key sectors as well as creating a legacy of assets that have long-lasting economic, social and environmental benefits.

New Scottish Growth Scheme: £500 million backing for young companies with ambitions to grow and expand into overseas markets

The Government intends to build on these measures by developing further plans for supporting the Scottish economy in these difficult times. We will work with business organisations, the UK Government and the Scottish Parliament to establish a new Scottish Growth Scheme.

This will provide up to £500 million over three years of investment guarantees, and some loans, up to a maximum of £5 million per eligible business.

This will be focused on new and early-stage, high growth potential companies, with clear export growth plans, particularly in technology-intensive firms and businesses in emerging markets, such as Fintech

In order to make this work appropriately, we will discuss in detail with business organisations, the Scottish Parliament's Finance Committee and the UK Government.

We will also urgently press the UK Government to follow our lead and announce its own economic stimulus package which would in turn enable us to do even more to support the economy through public investment and other policy measures.

Home Energy Scotland

The Scottish Government has also set up a new dedicated service to provide information and support to businesses affected by the EU referendum. A new Post-Referendum Business Network will work closely with the main business bodies, the Scottish Trades Union Congress ( STUC) and the Scotland Office to prepare a detailed response to the challenges caused by the new environment. We are also developing opportunities to further strengthen and promote Scotland's economic relationships with our EU and global trading partners.

European funding to support the Economy

European Structural Funds support important economic, employment and social priorities, helping to grow Scotland's economy. We have been working to speed up approval processes to ensure that money reaches businesses, communities and individuals where it is most needed. We have now approved Structural Funds projects with a total value of £290 million of grant. With partner funding this means an investment of £650 million in Scotland's people, communities and businesses.

This includes some previously announced support for low carbon investment, innovation support for business and employability, but also encompasses significant new investments:

  • £19 million to develop higher level skills for key sectors
  • £40 million to support Small and Medium Sized Enterprises ( SMEs) investment and access to finance
  • £26 million for business growth and internationalisation
  • £8 million to develop green infrastructure in disadvantaged communities
  • £14 million to support social enterprise and tackle poverty

These funds play a strong positive role in developing Scotland's economy. SMEs who are the backbone of our economy will receive additional support, including £26 million from the European Regional Development Fund ( ERDF) set out above - £65 million including partner funding. This will offer one-on-one support to SMEs with growth potential over the next five years, developing their leadership and readiness to invest, innovate and export to reach new markets. This support will target 12,000 businesses, and aims to identify the next 1,000 growth companies in Scotland.
In addition to advice and support, the ability of SMEs to access finance is essential for business investment and expansion. The Scottish Government is increasing funding available and making it easier for SMEs seeking finance. Both are crucial to achieving growth and supporting jobs in the short-term. This will include our £40 million SME Holding Fund, supported by the European Regional Development Fund. The Fund will aim to attract £300 million total investment in Scottish SMEs; expand the business angel network; and extend the range of support available through the Scottish Investment Bank to a larger number of SMEs.

National Manufacturing Institute

A key action for the forthcoming year is developing the business case for a new manufacturing centre of excellence and skills academy, the National Manufacturing Institute for Scotland. This is a major, transformative project being developed by the Scottish Government and Strathclyde University, in association with the Scottish Research Partnership in Engineering, our enterprise agencies, Skills Development Scotland, the Scottish Funding Council and the private sector. Such investment could create a new era for Scottish manufacturing. The centre is intended to equip manufacturers of all sizes to compete in future international markets and support the transformation of Scotland's manufacturing industry in terms of innovation and digital opportunities, creating sustainable, high-value and highly skilled jobs.

Manufacturing accounts for over half of Scotland's international exports, half of our research and development spend and employs nearly 190,000 people across the country. The manufacturing sector can boost productivity and support inclusive growth by addressing regional imbalances through local economic spill-overs and supply chain linkages and creating highly-skilled and well-paid jobs.

The Manufacturing Action Plan ( MAP) was published this year in support of our productivity ambition. We have already implemented a number of key aspects of the MAP alongside the launch of 'Making Things Last', our circular economy strategy, and the introduction of our new Circular Economy Investment Fund and Service ( CEIFS). In addition, the Scottish Manufacturing Advisory Service ( SMAS) has launched a new capital asset review service, a free service to all manufacturers.

Infrastructure investment

Since 2007, the Scottish Government's infrastructure programme has invested in transport, water, housing and digital infrastructure, providing a vital boost to economic activity and high quality jobs in the construction and service sectors. Over this Parliament, almost £20 billion will be invested in a major infrastructure programme designed to help build Scotland's future. The Scottish Futures Trust will also continue to review existing Private Finance Initiative ( PFI) or Public Private Partnership ( PPP) contracts, seeking opportunities to improve value and reduce the cost to the public purse, including ending contracts where possible and appropriate.


We will build on Scottish Water's track record of investment with Scottish Water continuing to invest up to £3.6 billion over the rest of the current regulatory period 2015-2021. Projects in every part of the country will help to underpin economic growth - providing water and sewerage services for new housing and businesses as well as improving environment, drinking water and customer service standards. In particular this period will see major investment in Glasgow to modernise the sewerage network and address long-standing surface water management issues. We will continue to make lending available to support this vital investment programme.

Almost £20 billion will be invested in a major infrastructure programme designed to help build Scotland's future

Digital infrastructure

The Scottish Government has ambitious plans to improve access to high quality digital connectivity supported by a refreshed Digital Strategy. This will be published in late autumn and will set out how we will take forward our ambitions aimed at realising Scotland's potential in a digital world. In this Parliament, we will build on the success of our existing broadband investment programme and deliver our commitment to extend superfast broadband to 100% of premises across Scotland.

Over the coming year we will:

  • launch our new delivery plan to reach the 100% target
  • invest £90 million in the Digital Scotland Superfast Broadband programme, which is on track to deliver access to fibre optic broadband to 95% of Scottish premises by end 2017
  • develop for spring 2017 a mobile programme to address gaps in 4G mobile coverage


Digital enables us to achieve our ambitions for Scotland and deliver our priorities in an efficient and future-proofed way. It shapes our approach to public service reform, underpins sustainable economic growth and enables us to promote social mobility and tackle inequalities in our communities.

We take a coherent approach across all strands of digital activity, built around the core vision to realise Scotland's full potential in a digital world. Our intention is to create a virtuous circle of investment in infrastructure, skills and innovation leading to stronger growth, increased tax income, and more affordable public services.

Our investment in the Digital Scotland Superfast Broadband programme is delivering new fibre infrastructure across Scotland, extending coverage and supporting economic growth in areas that would not be served commercially. The programme is on track to deliver fibre access to at least 95% of premises in Scotland by the end of 2017; having successfully delivered our 85% target six months ahead of schedule.

Over 630,000 homes and businesses across Scotland now have access as a result of the programme, which has seen over 2,500 fibre street cabinets installed so far and more than 7,500km of cable laid; enough to stretch from Glasgow to Kathmandu.

Our commitment to deliver 100% superfast broadband coverage by 2021 will transform connectivity and improve the productivity of businesses in remote and rural areas, transforming the prospects of those who live there.

Cyber resilience is fundamental to the growth and prosperity of Scotland in a global economy. It is also vital for our national security. We will continue to work in partnership with the private and public sector, communities and individuals to advance our interests online and protect ourselves.

Our public services will be developed in conjunction with the people who use them and will be based on common processes and technologies which work across the traditional boundaries of public sector organisations. It is clearly more efficient to re-use technologies wherever possible rather than reinventing them from scratch. This approach can both save money and help re-shape the way in which we deliver health and social care, extend access to education and provide a justice system that is fit for the future. The introduction of new powers, in particular, offers an opportunity to introduce new digital ways of designing services which are both highly efficient and meet the expectations of their users.

Our commitment is to deliver superfast broadband access to at least 95% of premises in scotland by the end of 2017, and 100% by 2021 this will transform connectivity, improving the productivity of businesses in remote and rural areas and the prospects of people who live there

Our ambition for Scotland's economy and our public services requires a digitally-skilled and empowered workforce so we must address the shortage in specialist digital skills which risks becoming a bottleneck to growth. This immediate demand for women and men with strong and specialist digital skills sits side-by-side with a need to develop a broader pipeline over time - our labour market and Science Technology Engineering Maths ( STEM) strategies, and the priorities across our delivery and support systems, will reflect these needs. We also need to equip all our citizens with the skills they need to gain the full benefits of technology as it changes and evolves.
As we embrace digital it is vital that we take action to ensure that nobody is excluded from the benefits it provides. We wish to build on our successful partnership with the third sector to encourage the development of digital skills and will provide opportunities, as part of our commitment to democratic renewal, to our communities to engage in and shape the way that we provide our services. We will also review current barriers to the wider introduction of digital public services and find suitable legislative opportunities to overcome them.

To support this we will publish a refreshed Strategy in late autumn that sets out how we will take forward a range of ambitions aimed at realising Scotland's full potential in a digital world.


Good transport links continue to play an essential role in creating a sustainable economy.

We refreshed our National Transport Strategy during 2016 and will work with stakeholders in the coming year to start taking forward our commitment to a full review.

Our three key strategic outcomes for transport are - improved journey times, reduced emissions to tackle climate change and improve air quality and health, and improved accessibility and affordability.

Our transport network supports and connects communities and enables people to go about their daily lives. Choices around travel are the result of millions of individual decisions made every day.

However, transport choices also impact on the environment, through the role that transport plays in creating greenhouse gas emissions. The role of Government is to facilitate these individual choices, but to balance that by providing leadership in measures to reduce greenhouse gas emissions generated by transport.

Our role, as set out in the forthcoming Climate Change Plan on how we are meeting our climate change targets, will be to promote strategies to:

  • reduce demand for transport
  • facilitate modal shift to more sustainable forms
  • decarbonise vehicles
  • make the transport network as efficient as possible

Transport emissions have fallen by 1.9 mega-tonnes since the peak of 2007 and are now at 1990 levels with falls over all of the last seven years.

Transport Infrastructure

To continue to take a strategic vision for infrastructure investment, the Strategic Transport Projects Review ( STPR) will be reviewed, in alignment with the National Planning Framework to enable a comprehensive review of national infrastructure priorities. Progress on key road improvements, including improvements to the A77 south of Girvan, linking to the Cairnryan Ferry hub and the A75 and improvements to connect Dumfries and the M74, will be considered as part this review. This is in the context of:

  • a new National Transport Strategy
  • our new Climate Change Plan
  • our Land Use Strategy 2016-2021
  • the community empowerment agenda
  • public sector reform
  • spending priorities

The Borders railway, the UK's longest newly-constructed railway for more than 100 years, has shown how investment in rail infrastructure can yield benefit for travellers, the environment, the economy and communities. We will examine the case for an extension of the railway along with improvements to the A1, A7, and A68 with a study to identify Borders transport requirements reporting by the end of 2017.


We will deliver our planned investment in the Scottish rail network and continue to provide capital funding in support of Strathclyde Partnership for Transport's subway modernisation programme. We will also work jointly with Network Rail and the Department for Transport to identify options to improve journey times, capacity, resilience and reliability on routes between Scotland and England, including a three hour journey time between the central belt and London.

In 2016-17 we will continue to deliver a range of network improvement works through key rail projects, including the Edinburgh-Glasgow Improvement Programme, the Aberdeen to Inverness line, the Highland Main Line, Stirling-Dunblane-Alloa Electrification and the redevelopment of Dundee Station. Milestones in the coming year include:

  • Edinburgh Gateway Rail/Tram interchange open to passengers from December 2016
  • Electrification of Edinburgh-Glasgow via Falkirk High line to be completed by July 2017, enabling services to be operated by a new fleet of faster, longer trains


The substantial programme of investment in road improvements and maintenance will continue in the coming year. £1.4 billion of investment in the road network will include work to dual the A9 and A96. The programme also includes the new Forth Bridge, the Queensferry Crossing, which is expected to be fully open to traffic by May 2017 and is the biggest transport infrastructure project in Scotland for a generation. The project is under budget and has returned £245 million worth of savings to the public purse since construction started in June 2011 as well as providing thousands of jobs.

The M8 M73 M74 motorway improvements project will be complete by spring 2017 and the Aberdeen Western Peripheral Route/Balmedie-Tipperty project will be open to traffic in winter 2017.

As part of our preparation for a Transport Bill later in the Parliament, during 2016-17 we will work with roads authorities, utilities, road users and others to develop legislative and other options for enhancing and improving the role of the Scottish Road Works Commissioner and the wider regulation of road works. We will also work with stakeholders to develop legislative options for improving bus services and securing nationwide multi modal smart ticketing.

We will also undertake a full review and stakeholder consultation later this year to develop the necessary legislation to promote responsible parking for all, taking account of the complexities of implementation and enforcement. The Scottish Government will support the Member's Bill proposal to ensure that seatbelts become a legal requirement on all dedicated school transport in Scotland.


The Scottish Government encourages the transfer of freight from road to more environmentally friendly modes. In 2016-17, we will support eight rail freight services in Scotland, moving around 3.5 million tonnes of freight by rail rather than road. In addition, through freight facilities grant funded operations, we are helping companies to deliver around £3 million in environmental benefits.


Free travel through the National Entitlement Card will continue on local or Scottish long distance buses for Scotland's older people and disabled people. The current terms for reimbursing bus operators expire in March 2017. An announcement on revised terms will be made this winter. We will also examine with stakeholders options to safeguard the longer term sustainability of the concessionary travel scheme.

In 2016-17 we will continue to deliver a range of network improvement works through key rail projects

In the coming year we will also start work to deliver three months' free bus travel to those receiving the new Jobs Grant as well as free bus travel for Modern Apprentices aged under 21.

We will also invest £2 million in low carbon buses through our Green Bus Fund.

Smart Ticketing

Throughout this year saltirecard smart ticketing will be promoted to passengers to exploit investment already delivered across the whole ScotRail network and the Glasgow Subway, and will be rolled out on an increasing number of bus services in Scottish cities and rural areas. Work to deploy saltirecards on Clyde and Hebrides Ferry routes will continue.

Free travel through the National Entitlement Card will continue on local or Scottish long distance buses for Scotland's older people and disabled people


Later this year we will publish a new study considering potential arrangements to reduce fares on ferry services to the Northern Isles. Tendering for the new town centre to town centre Gourock-Dunoon ferry service commenced in the summer. We will continue to invest in new ferries and in redeveloping and improving ferry facilities, including those at Brodick due for completion in summer 2017. Later this year the hybrid ferry MV Catriona will be brought into operation.


We will bring forward a Bill in the first year of this Parliament to legislate for a devolved tax to replace Air Passenger Duty ( APD) in Scotland allowing us to design a tax that better fits the needs of Scotland's economy and best supports our strategic objective to boost Scotland's international connectivity. The replacement tax is planned to come into effect in April 2018.

To ensure air services remain more affordable for remote communities in the Highlands and Islands, facilitating accessibility, social inclusion and economic development, we will maintain the existing air discount scheme in 2016-17 at 50%.

A Bill to legislate for a devolved tax to replace Air Passenger Duty (APD)

Accessible Transport

We will publish Scotland's first Accessible Travel Framework in September 2017 to enable disabled people to enjoy the same travel rights as everyone else.

Low carbon transport

Our investment in low carbon transport is underpinned by our leadership role. To increase the use of low carbon transport in Scotland, and in line with the new Climate Change Plan, we will:

  • by spring 2017 refresh our 'Switched on Scotland' Electric Vehicle Roadmap setting out our vision to free Scotland's towns, cities and communities from the damaging emissions of fossil-fuelled vehicles by 2050. We will also continue to roll out a network of electric vehicle charging points across Scotland
  • maintain record levels of investment in cycling and walking for the duration of this Parliamentary term and publish a third iteration of the Cycling Action Plan for Scotland by the end of the year, setting out actions to meet the vision of 10% of everyday journeys being by bike by 2020. We will continue to support the creation of walking and cycling infrastructure, developing a people-centred approach to place. As well as providing physical infrastructure, we will support a range of behaviour change initiatives, such as our Smarter Choices, Smarter Places Programme, in partnership with local authorities, the third sector and other stakeholders. And we will work with all seven cities to encourage Bike Life reports for our most populous places, taking into account the lessons learned from Edinburgh's experience in producing its report
  • launch the Low Carbon Travel and Transport programme, supported by £12 million from the European Regional Development Fund ( ERDF), which will include the development of active travel and low carbon vehicle 'hubs', with funding made available through a challenge fund process and aiming to shift our behaviour in how we choose to travel and how this impacts on the environment

Refreshed Cycling Action Plan for Scotland meeting the vision of 10% of everyday journeys being by bike by 2020

Developing a low carbon economy

2015 was the warmest year on record for the planet. The global average temperature was one degree Celsius warmer than at the start of the twentieth century. Scotland has already made huge progress in tackling climate change, meeting and exceeding - six years ahead of schedule - our 2020 target of a 42% reduction in emissions. By driving the pace of decarbonisation more quickly than our competitors, we can develop the low carbon products and services that will be needed throughout the world in the future.

In 2016-17 we will publish a Climate Change Plan. It will set out infrastructure priorities for the coming decades in each of the key sectors, providing clear signals to commercial investors at a time of investment uncertainty following the EU referendum.

It will be accompanied by a new Energy Strategy, providing a visionary statement of the Scottish Government's plans for low carbon energy production and energy use over that period.

Together, the Climate Change and Energy plans will steer decisions on a host of issues: how we heat and power our homes and businesses, how people and goods will move around our country in the future, how our land is used and how the standard of the buildings in which we live and work can be improved to reduce the cost of energy.


Low carbon energy provision is fundamental to the sustainable growth of the Scottish economy and the development of a host of modern sectors and services in Scotland. In the coming year, the Scottish Government will publish a new Energy Strategy for Scotland, fully integrated with the new Climate Change Plan, presenting a bold vision for the future of energy in Scotland. Clear signals of Scotland's long-term energy priorities will provide clarity to prospective investors, at times of investor uncertainty following the EU referendum.

The new Energy Strategy will reaffirm the Government's overarching commitment to reducing energy demand and supplying clean energy, driving a host of economic, social and environmental improvements and promoting sustainable, inclusive growth.

The new Scotland's Energy Efficiency Programme ( SEEP) will commence in 2018 with substantial annual public funding coupled with new powers for the Scottish Parliament over the regulated energy suppliers. SEEP will be a coordinated programme to improve the energy efficiency of homes and buildings in the commercial, public and industrial sectors.

Alongside the consultation on the new Energy Strategy, to drive demand for building owners to improve their properties, we will consult on the regulation of private rented sector housing to increase efficiency standards and heat regulations commensurate with the scale of the heat market. As part of the programme we will also consult on phased regulation of other existing buildings to bring them up to higher energy efficiency standards as well as look at financial incentives.

To help inform SEEP we are working with stakeholders to test different approaches to improving the energy efficiency of Scotland's buildings and we are supporting this work with £9.5 million of funding to 11 local authorities to carry out SEEP pilots in 2016-17 with further funding being made available next year.

SEEP delivers our commitment to make energy efficiency a national infrastructure priority, boosting energy efficiency investment in Scotland and decarbonising heat provision over the long term. The programme has multiple benefits, including:

  • measures to make our homes and places of work warmer, promoting more affordable energy for consumers, helping to tackle poverty and improve the competitiveness of the Scottish economy
  • the opportunity to create a substantial Scottish market and supply chain for energy efficiency services and technologies, with an estimated 4,000 jobs per annum across Scotland, including in remote areas, based on the estimated overall investment of up to £10 billion
  • measurable health and early years improvements through people living in warmer homes
  • regeneration of communities through upgraded building stock
  • substantially reduced greenhouse gas emissions contributing to meeting our ambitious climate change targets

Measures to make our homes and places of work warmer, promoting more affordable energy for consumers

More than half a billion pounds for energy efficiency and combating fuel poverty through SEEP over the next four years

Renewable energy

We have a continuing commitment to the target for the equivalent of 100% of electricity demand to be supplied by renewables by 2020 and will consider the role for new renewable energy targets under the CCP and ES. We will continue to call upon the UK Government to offer a route to market for new renewable generation, especially onshore wind, where there are clear benefits to the Scottish economy and consumers throughout the UK.

£10 million of funding will be made available for community energy through Community and Renewable Energy Scheme (CARES)

£10 million of funding will be made available for community energy through the Community and Renewable Energy Scheme ( CARES) which has helped so many communities invest in renewable energy already. The Government will also consult during 2017 on plans to deliver a Scottish Green Energy Bond and a possible government-owned energy company, as part of new models of support for the growth of local, community-led energy.

Despite legal challenges to offshore wind development, offshore wind continues to be an essential part of Scotland's future energy requirements. The build-out of the £2.6 billion Beatrice offshore wind farm will be completed in 2017, bringing economic and community benefits to Caithness and Scotland as a whole. The new European Offshore Wind Deployment Centre in Aberdeen bay will also be developed, following an unsuccessful legal challenge.

This year the climate challenge fund will make £10 million available to fund projects

A strong example of our commitment to Scotland's emerging tidal energy sector is the £23 million investment we have made in the MeyGen project, the world's first and largest planned tidal stream array. The first turbine will be installed at Nigg Energy Park this month.

Action to reduce emissions further

Last year in Paris global agreement was reached on action to reduce emissions. Scotland will play its part in delivering on this commitment. We will work with our independent advisers, the Committee on Climate Change ( CCC), to prepare a new Climate Change Bill, including an ambitious new target of reducing actual Scottish emissions by more than 50% by 2020. We will be consulting on the Bill, based on CCC advice, early in 2017.

The Scottish Government is focused on the multiple benefits of reducing emissions. These include improving the lives of vulnerable people, building resilience in homes, businesses and communities, providing employment opportunities, encouraging entrepreneurship and innovation.

This year the Climate Challenge Fund will make £10 million available to fund projects which deliver the greatest reduction in carbon emissions and support Scotland's most deprived communities.

Oil and Gas

The Scottish Government's approach to energy continues to support a strong oil and gas sector, recognising its contribution to the Scottish economy and the essential role it will play in the future diversification of Scotland's energy supplies.

Scotland's Energy Jobs Taskforce is a strong partnership of industry, public sector and trade union representatives established to help tackle the immediate challenges facing the energy sector. Chaired by Scottish Enterprise, the Taskforce meets quarterly and reports to the Scottish Energy Advisory Board.

The Taskforce aims to:

  • retain and grow the talent and skills in the industry
  • identify and implement support to people who are facing redundancy
  • enhance partnership and collaboration

Over this year £12.5 million will be made available for oil and gas innovation and business support, including £10 million of Scottish Enterprise funding to help firms reduce risks associated with carrying out research and development and improve access to specialist experts to help kick-start innovation.

Over this year £12.5 million will be made available for oil and gas innovation and further business support including £10 million of Scottish Enterprise funding

We will spend a further £4 million this year through the Transition Training Fund ( TTF) to help oil workers retrain in other sectors, including the renewables sector, and continue to ensure it is providing effective support to those affected by the downturn in the sector.

We will also support the development of the Oil and Gas Technology Centre, to be the 'go to' global centre for solving offshore mature basin technology challenges, driving the sort of transformative change the industry needs to modernise and tackle the challenges of sustained low oil prices and a maturing basin and build supply chain expertise and an even stronger export base.

We have called on the UK Government to bring forward further fiscal support for exploration, and to demonstrate progress on enabling oil and gas companies to secure loan guarantees. We will continue to work with the Oil and Gas Authority ( OGA) to consider if there are any practical ways that we could support exploration and appraisal activity in the North Sea.

The Scottish Government is committed to working with industry, regulator and stakeholders to enable production to continue in the North Sea for as long as possible while ensuring that decommissioning is executed in a safe, environmentally sound and cost effective manner in order for the supply chain to gain competitive advantage.

The decommissioning sector offers significant economic opportunities, including job creation and technological development within the Scottish supply chain. Scotland is in a strong position to develop this opportunity as Scottish companies have key strengths in areas such as preparatory work for cessation of production, cleaning and removal of hydrocarbons from infrastructure, and disconnection and disposal. There is significant potential to anchor expertise in Scotland with a view to exporting to overseas markets, in what is an emerging global sector.

To ensure that Scotland is well equipped to capture these opportunities, a Decommissioning Action Plan is being developed by Scottish Enterprise - this will be complementary to OGAS's decommissioning strategy. Alongside our Enterprise Agencies, we are working to improve information on current and planned decommissioning activity, and we have commissioned further work to identify potential sites for investment with a view to increasing capacity for Heavy Lift Vessel access to Scottish ports, increasing the economic return to Scotland.

The Government will maintain a moratorium on unconventional oil and gas to provide time to take forward a comprehensive programme of research and to hold a public consultation. The consultation will be published this winter and research findings will be publicly available before the consultation.


A strong innovation performance is key to boosting long-term productivity growth and higher living standards. In 2016-17, the Government will invest over £1 billion in our universities to enable excellent teaching, world-class research and cutting edge innovation.

Spending on research and development in Scotland increased between 2006 and 2014, from 1.32% of Gross Domestic Product ( GDP) in 2006 to 1.56% of GDP in 2014 but Scotland's business research and development expenditure as a share of GDP is low by international standards.

To achieve a more innovative economy we need to develop a more innovative and entrepreneurial culture and drive increased business demand for innovation. Improving how the public sector, through its public procurement, acts as a catalyst for business innovation and providing streamlined and simplified innovation support, and improving collaboration between business and academia, are also key.

As a key sector, the Scottish Government will continue to support the work of Life Sciences Scotland as they work to refresh the strategy for the sector. Scotland has a thriving life sciences community which is recognised for the distinctive capabilities of our business base and research institutions, international reputation and potential for significant growth and creation of high value jobs.

Scotland's industry-led life sciences strategy, the introduction of Enterprise Areas for Life Sciences, initiatives such as the Health Innovation Partnerships, and the Innovation Centre programme, have enhanced support for the sector and sought to link it more effectively to the NHS.

We will work with the Council of Economic Advisers and the Scotland CAN DO Innovation Forum to develop an action plan to address these needs. New innovation and entrepreneurship approaches will also be piloted in key sectors across Scotland.

Providing continuing support for the Scottish EDGE Fund to invest in our highest potential companies

Support the private sector to drive forward Scotland
CAN DO approach to innovation and entrepreneurship

In 2016-17 we will implement new support for business innovation by:

  • developing an innovation prize to reward, and invest in, world class innovation in Scottish companies
  • continuing participation in the pan-Europe Vanguard Initiative, working closely with our European partner regions to co-create, co-fund and collaborate on projects around key areas of innovation specialisation
  • improving the coordination and impact of public sector budgets by establishing an innovation reference group in the Scottish Government Procurement Directorate
  • driving up digital innovation through pilot support for CIVTECH, the world's first cross public sector technology accelerator
  • showcasing the best in Scottish innovation, in partnership with business and the creative industries
  • identifying and nurturing innovative firms with high growth potential by working with our enterprise agencies to create an expanded and collaborative 'Scale Up' programme
  • providing continuing support for the Scottish EDGE Fund to support home-grown entrepreneurial talent and our highest-potential companies and drive forward the Scotland CAN DO approach to innovation and entrepreneurship
  • tackling the gender-gap in enterprise by investing £200,000 into actions delivered through the Women In Enterprise Action Framework, the only one of its kind in Europe

Review of enterprise and skills support

This summer the Scottish Government published its call for evidence to inform the review of enterprise and skills services. Scottish Enterprise, Highlands and Islands Enterprise, Skills Development Scotland ( SDS), and the Scottish Funding Council ( SFC) play an important role in delivering our economic strategy and responding to the uncertainty caused by the outcome of the EU referendum. The review will help deliver the joined-up support that our young people, universities, colleges and businesses need. Drawing on responses to the call for evidence and extensive engagement with service users, partners and delivery bodies the review will make recommendations on the change required to improve our economic growth, productivity and social inclusion so that Scotland moves from the third quartile of Organisation for Economic Co-operation and Development ( OECD) nations to the top quartile. The EU referendum result has heightened the uncertainty facing enterprise and made the conditions under which they are operating more fast-moving and potentially challenging. The review will ensure a responsive system of economic and skills support for our economic resilience and growth.

Tourism is a key sector for Scotland's economy and we will work with Skills Development Scotland to develop the leadership capacity and skills required to support future growth. Together with the Scottish Tourism Alliance and tourism industry leaders, we will build better tourism businesses through a revised Tourism Scotland 2020 Strategy delivering on the key priorities of leadership, digital, visitor experience and investment.

Will help deliver the joined-up support that our young people, universities, colleges and businesses need

In April 2017 the Scottish Parliament's new powers over income tax rates and thresholds will come into full effect


The Scotland Acts of 2012 and 2016 together give the Scottish Parliament powers to design and control three fully devolved taxes - Land and Buildings Transaction Tax, Scottish Landfill Tax (both in place since 2015) and, soon, a replacement for Air Passenger Duty. The Acts combined also give the Parliament power to set rates and thresholds for income tax on non-savings, non-dividend income. These powers are in addition to the power over local taxes that the Scottish Parliament has had since devolution in 1999 (the existing local taxes being Council Tax and business rates).

We are already using these powers to help grow Scotland's economy, promote fairness and provide additional investment in high quality public services, and they will become increasingly important to the work of the Scottish Parliament. But even once these powers are fully implemented, the Scottish Parliament will be responsible for raising less than 40% of devolved expenditure so we will continue to press for greater tax powers.

Income tax

In April 2017 the Scottish Parliament's new powers over income tax rates and thresholds will come into full effect. We have already indicated that we will use the powers in a manner that protects lower income taxpayers by freezing the basic rate and guaranteeing increases in the personal allowance. Increases to the threshold for higher rate taxpayers will be restricted to a maximum of inflation.

We will announce specific proposals for using our tax powers as part of the 2017-18 Scottish Budget.

A working group has been set up between the Scottish Government and the Scottish Parliament to set out a revised process for scrutinising and approving the Scottish budget in order to accommodate newly-devolved fiscal powers in the Scotland Act 2016. How the setting out of plans for Scottish tax rates each year in our budget works most effectively will be a key consideration of this group.

Land and Buildings Transaction Tax

We have already demonstrated with Land and Buildings Transaction Tax ( LBTT) and Scottish Landfill Tax that we can effectively and competently design taxes on a sound base of consultation and evidence. By prioritising support for first time buyers and those buying homes at the lower end of the market, we took almost 9,700 extra house purchases out of tax in the first year of LBTT ensuring more than 41,600 buyers paid less tax than they would have under UK stamp duty.

Council Tax

We will make Council Tax fairer by changing how the rate for more expensive properties in bands E-H is calculated and asking people in these bands to pay more. The Council Tax Reduction Scheme will be extended to protect up to an additional 54,000 low income households in bands E-H, more than a third of which are pensioners. By increasing the child allowance within the Council Tax Reduction Scheme by 25%, up to 77,000 households will benefit by an average of £173 per year and 140,000 children across Scotland will be helped.

These changes will generate an additional £100 million a year for schools and will be in place from April 2017. We will also lift the Council Tax freeze from April 2017 and allow Councils to increase Council Tax across all bands by a maximum of 3%, generating up to £70 million. We will introduce legislation to allow councils to end the Council Tax discount for second homes from April 2017.

We will bring forward a Bill to legislate for a devolved tax to replace Air Passenger Duty (APD)

Air Passenger Duty

We will bring forward a Bill to legislate for a devolved tax to replace Air Passenger Duty ( APD) in Scotland so that we can design a tax that better fits the needs of Scotland's economy and best supports our strategic objective to boost Scotland's international connectivity. The replacement tax is planned to come into effect in April 2018.

We will freeze the basic rate of income tax

By increasing child allowance within the Council Tax Reduction Scheme by 25%, 77,000 households will benefit by an average of £173 per year and 140,000 children across Scotland will be helped

Supporting our rural economy

Rural Scotland accounts for 98% of the land mass of Scotland, nearly one fifth of our population lives there, and it hosts some of the country's most important economic sectors. It is particularly vulnerable to the uncertainty caused by the result of the EU referendum vote.

The Scottish Rural Development Programme ( SRDP) 2014-2020 will continue to provide funding in 2016-17 to help respond to uncertainty caused by the result of the EU referendum. The SRDP will help enhance the rural economy, support rural communities, address the impact of climate change, protect the natural environment, and stimulate sustainable economic activity.

As part of building the rural economy, we will hold a series of summits from autumn 2016 through to spring 2017 with key sectors and interests to explore how best to deliver investment, sustainable growth, jobs and opportunities in rural and island communities. We will also develop a Scottish Rural Infrastructure Plan in 2017 to better coordinate existing and planned expenditure and resources through improved collaboration.

98% of the land mass of Scotland is rural
one fifth of our population lives there

We will continue to seek clarity from the UK Government on the provision of funding for rural development in the event that Scotland is removed from the EU as part of the UK, which would allow us to continue the SRDP through its programme period.

Extension of the UK Government EU funding guarantee will allow the SRDP to continue to support community-led local development in rural and coastal areas through the LEADER approach, a grass-roots way of promoting rural development, and through targeted initiatives on rural enterprise needs. We will enable Scottish Rural Action to support delivery of the outcomes from the 2nd Scottish Rural Parliament, being held at Brechin in October.

As part of building the rural economy, we will hold a series of summits from Autumn 2016 through to Spring 2017

Business Rates

Scotland already offers a competitive business rates regime and we will further expand the Small Business Bonus Scheme from 2017, removing the burden of business rates entirely from 100,000 premises and giving Scottish business a competitive edge even as a separate external review of the whole business rates system reports by summer next year. That review is already under way and has called for initial evidence from Scottish business by the autumn. The Government looks forward to receiving the review group's recommendations and acting quickly to address them.

We will further expand the Small Business Bonus Scheme from 2017, removing the burden of business rates from 100,000 premises

Improving international trade

Scotland's vote in the EU referendum reflected Scotland's international outlook and the importance of the single market to Scotland's economy. In order to help stabilise and stimulate the Scottish economy we will step up delivery of our 2016-21 Trade and Investment Strategy, taking further action to boost exports, maintain and attract investment and actively demonstrate that Scotland is open for business.

We are investing £3.5 million to set up new innovation and investment hubs in London, Dublin and Brussels. These hubs will play a critical role in attracting investment to Scotland, helping businesses to trade internationally, raising Scotland's international profile and, crucially, protecting Scotland's relationship with the EU.

Invest £3.5 million to set up new innovation and investment hubs in London, Dublin and Brussels

The Dublin Hub is already operational. The London Hub, which will open early next year, will bring together the Scottish Government, our enterprise agencies and VisitScotland under one roof and provide a 'touch down' and meeting space for Scotland's businesses and other organisations. Plans for the Brussels Hub are being taken forward as part of wider post referendum planning.

Other key actions include:

  • delivering a comprehensive programme of Scottish Development International led trade missions and events and work with others to enhance and complement that programme
  • providing an additional £200k to help businesses help each other through pilot Local Export Partnerships in four to six areas across Scotland
  • delivering the Scotland Food and Drink Export Plan to expand key markets
  • growing Scotland's water economy through Scottish Water International and the Hydro Nation programme

Starting with London, we will raise Scotland's profile and connect businesses to opportunities and influencers through Scottish business networks in key global cities. New Trade Envoys and Global Scots will play a key role in supporting and championing all of the actions and delivery of the Trade and Investment Strategy.

We will also widen and deepen our business engagement to shape our response to the EU Referendum and wider trade and investment activity. This will ensure that the Scottish Government effectively represents the distinct needs and priorities of Scotland's businesses and investors. In particular, we will listen to and engage with businesses through existing engagement structures, sector specific international trade summits and a dedicated Investor Forum for our critical inward investment community.

A Ministerial Trade Board will provide advice to Ministers on the most effective ways to boost Scotland's exports in the context of the outcome of the EU Referendum.

Inclusive growth

International evidence increasingly shows that higher levels of inequality can have a negative effect on economic performance and on economic, social and environmental resilience.

More equal societies also tend to be healthier, safer, more productive and more innovative. Making growth more inclusive is therefore important for improving Scotland's economic competitiveness and wellbeing, reducing wider inequalities, and improving opportunities for all.

Encouraging more inclusive growth means helping to create fairer work, a more inclusive jobs market, and greater regional cohesion across Scotland. It involves improving working environments and conditions, sharing economic benefits more widely, and tackling barriers to participation in the economy, including in areas such as access to education and training, quality childcare, and transport. Inclusive growth is premised on a diverse working age population in good physical and mental health.

Scotland already performs well on a number of dimensions of inclusion - for instance, Scotland has lower levels of income inequality than the UK as a whole and the second highest female employment rate in the EU. However, there is further work to be done to address the remaining challenges, such as health inequality, the gender pay gap and in-work poverty.

Inclusive growth and fair work

Our inclusive economic approach is the hallmark of the Scottish Government's Economic Strategy. By tackling directly issues of poverty, inequality and social exclusion, we can build a broader base for sustainable economic growth in the future.

In 2017 the Scottish Government will host an international conference on Inclusive Growth driving global leadership in this field of economic theory.

Building on the work of the independent Fair Work Convention which supports Government objectives of sustainable economic growth and reduced inequality, we will implement a package of measures in the coming year to support a resilient and fair labour market.

We will establish a stakeholders' forum to help frame how we can best use our new powers around Employment Tribunals. This will ensure that any new system in Scotland, introducing the abolition of fees, will meet the needs of employees and employers and ensure those who have been subjected to illegal working practices or who have been unable to resolve issues of poor treatment or discrimination in the workplace can more easily access justice.

Our Labour Market Strategy sets out our vision, and a range of actions, to support a strong labour market that drives inclusive, sustainable, economic growth, increases productivity and improves the lives of people through work.

We will continue to work closely in partnership with trade unions to develop a constructive and productive partnership, in contrast to the approach being taken in Westminster through the Trade Union Act. We will invest £250,000 in the trade union movement to support modernisation that will allow them to engage in a positive way, helping to mitigate the impact of the UK legislation.

We will invest £250,000 in the trade union movement to support modernisation that will allow them to engage in a positive way, helping to mitigate the impact of the UK legislation

We will contribute £2.2m in 2016-17 to support workforce development through the Scottish Union Learning Fund

We will also support the continuing work of the Fair Work Convention agreeing a remit with them for the next phase of their work to promote their Framework to employers, to engage specific sectors and in particular to promote the benefits of paying the Living Wage as part of a wider approach to fair work.

We will continue our work to extend payment of the Living Wage and we will double the number of accredited Living Wage employers from 500 in March 2016 to 1,000 by autumn 2017.

The Scottish Business Pledge was launched in May 2015. It is a voluntary commitment made by Scottish businesses to celebrate, promote and encourage business success based on the practical application of the principles of fairness, equality, and opportunity. It acts as a partnership between government and companies to boost productivity and competitiveness by investing in a culture of innovation, internationalisation, and productive, responsible business practices.

Almost 300 businesses - from Virgin Money, Michelin, the Scottish Chambers of Commerce, and Rabbie's Small Group Tours to KCP Ltd and Centrica - have made their individual commitment to the Business Pledge and inclusive growth. In the year ahead we will continue to raise awareness of the Pledge, and encourage more and more businesses to choose this route to higher productivity and business growth. And we will build on the strengths of the growing Pledge network, providing more opportunities for companies to come together to learn from each other: adding more events in 2017 to those already scheduled in October and November on the business benefits of family-friendly workplace policies and gender-balanced boards.

We are working with the Equality and Human Rights Commission to tackle pregnancy and maternity discrimination - our Ministerial working group will create guidelines for employers to ensure best practice on monitoring and reporting on pregnancy and maternity.

We will establish a 'Returners' project so that women can get help updating skills and knowledge and employers can retain skilled staff after a career break.

In addition to this we will develop a Workplace Equality Fund which recognises that the Labour Market does not provide good outcomes for many equality groups. This fund will draw on the recommendations made in the Race Equality Framework for Scotland 2016-2030 and the findings of the Equal Opportunities Committee inquiry into Removing Barriers: Race, Ethnicity and Employment, published in January 2016.

Following the current consultation with employers and other interested parties we will set out in our spending plans how we will respond to the introduction of the UK Government's Apprenticeship Levy in April 2017. Our aim is to develop a distinctly Scottish approach on the levy, supporting apprenticeships and wider skills development and driving closer engagement with industry in our efforts to enhance productivity and economic growth.

We will double the number of accredited Living Wage employers from 500 in March 2016 to 1,000 by Autumn 2017

We will continue with our successful 'Opportunities for All' commitment to support 16-19 year olds not already in education, training or employment, to take up an offer of an appropriate place in learning or training, to develop the skills they need to gain employment. In the coming year we will provide £4.8 million to support local authority delivery of the Opportunities commitment through post-16 transition planning towards further learning, training and employment, and Activity Agreements.

We will confirm the Scottish Veterans Fund of £120,000 to support the integration of former servicemen and women into wider society

We will also make a £6.1 million investment in Community Jobs Scotland ( CJS) to create 700 more training opportunities with support for up to 12 months for 16-29 year olds facing the greatest barriers to employment and continuation of support for CJS employers to pay the Living Wage.

We will continue to invest £4 million in 2016-17 in the Inspiring Scotland 14-19 Fund

We will continue to invest £4 million in the coming year in the Inspiring Scotland 14-19 Fund which supports disadvantaged young people into positive destinations for employment, education or learning.

We will continue to support employers to recruit young people who face the biggest barriers to employment, through Scotland's Employer Recruitment Incentive ( SERI). We will support companies participating in SERI to become Living Wage employers.

For young people who have been in care, we will work with the third sector to develop a new fund, based on the example of CJS, to specifically support them into appropriate work, training or educational opportunities.

We will consider a system of penalties for local authorities that have not settled outstanding equal pay claims or are still not paying equal pay by spring 2017.

We will provide 26,000 modern apprenticeship starts in the current financial year as a step towards providing 30,000 MA starts by 2020

We are committed to ensuring that no member of the Armed Forces, Service family member or veteran in Scotland faces disadvantage when accessing services and support. We will continue to support the role of the Scottish Veterans Commissioner and will confirm the Scottish Veterans Fund of £120,000 to support the integration of former servicemen and women into wider society.

Employment support for those out of work

Following devolution under the Scotland Act 2016, powers on employment support will be available to the Scottish Parliament from spring next year. This will enable us to develop and implement new services to help people find work - and stay in work. We will also take the opportunity to better align employability support in Scotland, to encourage sustainable and fair work, and to focus support on those who need most help to reduce inequality.

When we deliver Scottish employment support from spring 2017, we will initially do so through transitional arrangements, supporting some of the most vulnerable in society ahead of full services in 2018. We will ensure that the principles of fairness, dignity and respect are at the heart of our new services.

We will provide continuity of support for those who face sometimes significant challenges in finding work, including disabled people. But we will also work to better align employability support in Scotland across Scottish Government, public, third sector and other delivery partners.

We will commit an additional £20 million to delivering employment support in 2017-18, almost trebling the funding allocated by the Department for Work and Pensions ( DWP). Beyond 2017-18 we will also invest an additional £20 million each year - over and above the funding transferred from Westminster.

We will continue to provide skills development and employability support to individuals facing redundancy through our initiative, Partnership Action for Continuing Employment ( PACE), which aims to minimise the time those facing the threat of redundancy are out of work.

For Modern Apprentices facing redundancy we will help them find an alternative employer through Adopt an Apprentice to allow them to complete their apprenticeship.

Employability and skills

To ensure that our workforce, including our young people, is equipped with the skills they need to find meaningful employment in today's economy, we will:

  • provide 26,000 Modern Apprenticeship starts in the current financial year as a step towards providing 30,000 MA starts by 2020
  • as part of our consultation on the use of new social security powers, we will develop proposals on the implementation of a new Jobs Grant for 16-24 year olds returning to work after six months unemployment
  • continue work with Skills Development Scotland and other partners to implement the Equality Action Plan for Modern Apprentices in Scotland, to ensure the programme addresses gender imbalances and is open to all by increasing the number of trainees who are disabled or have been in care or are from a minority ethnic background
  • continue to fund local authorities to deliver the 'Opportunities for All' commitment, which offers an appropriate place in learning or training to all 16-19 year olds. This includes investment of £14.9 million in 2016-17 in supporting post-16 transitions towards employment including Activity Agreements, Inspiring Scotland 14-19 Fund and Community Jobs Scotland
  • continue to support the Employability Fund supporting 11,650 places in 2016-17

Developing the Young Workforce ( DYW), our strategy to improve the work readiness of our young people, will enter its third academic year this coming year. Working towards a reduction in youth unemployment of 40% by 2021, in the coming year we will continue to implement the Wood Commission's recommendations including:

  • extending the reach of careers advice to younger school pupils
  • embedding a new work experience standard
  • expanding the number of foundation apprenticeships
  • continuing to develop graduate level apprenticeships
  • funding and supporting the development of employer-led DYW regional groups across the country to encourage and support more employers to engage with education and to recruit more young people

Wood Commission's Recommendations


We will use our new consumer and competition powers to improve outcomes for consumers and businesses in Scotland. We will work with experts on consumer protection and competition issues, with a focus on fairness and doing the right thing for Scotland's consumers and businesses.

In November we will publish consumer and competition principles and a policy statement to highlight how we are already making an impact with our new powers, including:

  • working with key delivery bodies to ensure a high quality system of consumer advice which will play a vital role in empowering consumers and tackling inequality
  • creating a Scottish Consumer Taskforce which will identify and propose action on the key issues faced by consumers in Scotland
  • establishing a Scottish Competition Advisory Forum, which will bring together markets and business experts to inform delivery of fair and effective competition policy
  • examining ways of better coordinating information and intelligence to identify issues of consumer detriment at an earlier stage

We will continue to make the case for full devolution of consumer policy and increased accountability of the competition regime for Scotland. Whilst we will ensure our existing powers deliver change, we believe that more powers are needed to create a consumer protection regime that is adequately focused on, and responsive to, the needs of Scottish consumers and businesses.

Having the right advice available is essential to support the most vulnerable, and plays a vital role in tackling inequality and supporting inclusive growth. At present, the advice landscape is fragmented with many providers and does not reflect that consumers often have interlinked issues, such as debt as a result of struggling to pay household bills. We are, therefore, undertaking work to better understand the advice landscape. We will use this to support our goal of bringing Scottish Government advice services together to make it easier for people to receive advice that can help to find long-term solutions.

Following on from the successful Nuisance Calls Summit in June, which brought together regulators, industry and consumer groups together to find practical solutions to the problem of unwanted calls we will establish a Nuisance Calls Commission to deliver an action plan focused on empowering consumers to protect themselves, tackling persistently offending companies, supporting companies that want to do the right thing, and seeking to improve the regulatory environment.

Reducing waste

Our 2016 Circular Economy Strategy, 'Making Things Last', focuses on business opportunities in the food, construction, energy and re-manufacturing sectors and establishes Europe's first food waste prevention target - to reduce food waste by one third by 2025.

We will introduce a Circular Economy and Zero Waste Bill in the second half of the Parliamentary session and continue to work with local authorities to improve recycling rates and consider the role of deposit return schemes.

Farming and crofting

Agriculture plays a highly significant role in the rural economy and the Scottish Government is committed to supporting farmers and crofters.

The direct subsidy payments farmers receive are vital to many and to the wider rural economy. From 2014-2020 Scotland will receive around €4.6 billion (£3.5 billion) from Europe to implement the Common Agricultural Policy. This is one of the reasons why we are considering all possible options to ensure Scotland's continuing relationship with Europe and why we have called on the UK Government to make clear what their future plans are for these subsidy payments.

From 2014-2020 Scotland will receive around €4.6 billion (£3.5 billion) from Europe to implement the Common Agricultural Policy

We will continue to listen to the voices and views of the farming sector as we move forward and will do everything in our power to ensure the best possible solution for the agricultural industry in Scotland.

We know that our performance in making the 2015 payments was not good enough. We have said that we are sorry and that we are fixing it. The Scottish Government made available loans to all farmers and crofters who had not, by the end of March, received a Pillar 1 payment. The vast majority of payments under the Basic Payments Scheme ( BPS) were concluded in June and we have now made over £350 million of Pillar 1 payments. We are now putting the 2016 payments onto a proper footing. We will provide further details to Parliament shortly.

The importance of integrating a low carbon approach in our agricultural industry is recognised and we will come forward with a broad package of new policies to reduce greenhouse gas emissions from agriculture through better managing our soils, improving livestock health, and improving management of energy resources.

Building growth across all areas of rural Scotland is a priority for the Scottish Government. We will hold a debate around the future of farming, forestry, fishing, and the rural economy with a particular focus on the impact of the result of the EU referendum. This will include a range of work to explore how best to support fragile farming businesses in remote and constrained rural areas.

This year we will also engage with crofting stakeholders to begin the process of drafting a National Development Plan for crofting as part of a sustainable rural economy. This will include measures to support new entrants, explore the scope to promote the creation of woodland crofts, consider support for croft housing, and ensure community-owned estates are not disadvantaged by the croft registration process. This engagement will inform a new Crofting Bill planned for later in the Parliament.

In 2016-17 we will also begin implementing the agricultural holding provisions in the Land Reform (Scotland) Act 2016 to create a thriving tenanted sector and commence preparations to introduce the New Entrants Opportunity Programme and provide more opportunities for young people to access agriculture.


Forestry contributes almost £1 billion per year to the Scottish economy and supports more than 25,000 full time equivalent jobs. Scottish Ministers are committed to fully devolving forestry. We will introduce a Forestry Bill, to ensure the Scottish Government has control of all aspects of forestry and introduce new arrangements for its governance, development, support and regulation. These will help support Ministers' objectives of further enhancing the forestry sector's economic, environmental and social contributions.

A Forestry Bill, to be introduced in the first year, will ensure the Scottish Government has control of all aspects of forestry and will bring new arrangements for its governance, development, support and regulation

Continuing investment and economic growth from the sector depends on confidence in the availability of the timber supply. Forestry is a key contributor to climate change mitigation with annual planting targets of 10,000 hectares. We are already discussing options to stimulate increased planting and intend to announce actions later this year to speed up and streamline approval processes for sustainable planting schemes. We are also bringing together our ambition to plant more trees and the continued need to restore vacant and derelict land, especially from the legacy of opencast coal mining.


Fishing and aquaculture industries make a vital economic contribution, providing jobs and sustaining services, in many rural and coastal communities around Scotland.

Membership of the EU provides free trade access to a common market of over 500 million people. With exports of £438 million worth of fish and seafood to the European Community, which is the second largest food and drink export after whisky and the largest food export, we risk losing a significant market for our high quality products. The European Maritime and Fisheries Fund ( EMFF) will provide up to £15.2 million funding in 2016-17 supporting research, development and structural reform of the fisheries, aquaculture and fish processing sectors. It is vital we protect this important investment in the Scottish economy and jobs and we will continue to seek clarity from the UK Government on the provision of EMFF funding in the event that Scotland is removed from the EU as part of the UK, which would allow us to continue the EMFF through its programme period to 2020.

The previous European Fisheries Fund supported in excess of 8,000 jobs, often in vulnerable rural communities. Despite the uncertainty and lack of clarity over policy and funding from the UK Government, our priority remains supporting a fisheries sector that is sustainable in economic and environmental impact.

In order to do this we will build on the current Scottish Inshore Fisheries Strategy, which aims to modernise management of our inshore fisheries and we will consult with all sectors and interests in fishing to develop an Inshore Fisheries Bill.

To ensure that Scotland's fish resources and fisheries are managed sustainably to the benefit of fishing communities and businesses, we will:

  • seek to agree a new UK Fisheries Concordat to ensure that the Scottish quota is retained in the hands of active Scottish fishermen
  • following on from the Concordat, publish the outcome of our quota consultation, including action on new entrants
  • advise the owners of Scottish licensed vessels of the Government's determination to increase the percentage of direct landings that are made into Scotland
  • step up efforts to repatriate the Seafish Levy - the UK Government has refused to devolve levy raising powers and a new model for operations in Scotland has been developed

To ensure that Scotland's fish resources and fisheries are managed sustainably to the benefit of fishing communities and businesses, we will:
Seek to agree a new UK Fisheries Concordat to ensure that the Scottish quota is retained in the hands of active Scottish fishermen

Building a Good Food Nation

We want Scotland to be a Good Food Nation. There have already been significant achievements in food policy since the publication in 2008 of the first national strategy, with significant increases in economic performance and the emergence of the local food agenda. Scotland's food and drink industry has experienced impressive growth in recent years, much of it based on trade with the EU. Following the EU referendum result we will work with the sector and with the UK Government to develop the international trading conditions that will enable the sector to build on its success. To make further progress we will:

  • take forward, in partnership with industry and public sector, the recommendations of the Overton Report on deepening collaboration across the food and drink sector and report on progress by the end of 2016. This will include working with the food and drink sector to develop a national food and drink campus during 2017
  • work with key stakeholders to explore by December 2016 how public procurement can be used to increase the level of Scottish sourcing, including organic products
  • work with the Scotland Food and Drink partnership to develop and publish, in spring 2017, a refreshed food and drink industry strategy for Scotland
  • by spring 2017, set out how our £5 million investment will support island/regional food and drink
  • begin work in 2017 on a consultation on a Good Food Nation Bill to provide the potential for a statutory framework to join up the Government's approach on food, consider what steps can be taken to improve the effectiveness of the food and drink supply chain, working in partnership with all relevant players

We will work with the Scotland Food and Drink partnership to develop and publish, in spring 2017, a refreshed food and drink industry strategy for Scotland

A cleaner, greener Scotland

We must maximise the potential of Scotland's natural environment if we are to build a strong and sustainable low carbon economy.

We must work to maximise the potential of Scotland's natural environment if we are to build a strong and sustainable low carbon economy

We will take forward the actions set out in 'Cleaner Air for Scotland' - Scotland's first distinct air quality strategy - to reduce air pollution further. With the help of local authorities, we will identify and put in place the first low emission zone by 2018, creating a legacy on which other areas can build.

A well-managed environment helps to reduce flood risk. We will continue to work with councils, the Scottish Environment Protection Agency and other organisations to deliver Scotland's first ever flood risk strategies and river basin management plans.

Scotland provides the major part of the UK's contribution to Natura 2000, Europe's network of protected areas, with over 15% of our land designated for a wealth of habitats and species. We are committed to continuing action on biodiversity protection and habitat restoration. We have led the way in the EU in creating a statutory framework to prevent the introduction and spread of non-native species. Scottish Natural Heritage will report in October 2016 on its review of deer management arrangements and we will consider whether any changes are needed.

Police Scotland will create a new wildlife crime investigation unit to support the existing network of wildlife crime officers in complex investigations

We will continue our support for the Central Scotland Green Network ( CSGN) - Europe's largest green space initiative stretching from Ayrshire in the west to Fife in the east - with a budget of £1 million for the CSGN Trust in 2016-17. The network aims to provide opportunities to maximise the health, education and biodiversity benefits of greenspace to communities, particularly in disadvantaged areas.

We must protect the environment from those who seek to damage it for personal gain. We will increase the penalties for wildlife crime and consider the creation of new sentencing guidelines in line with recommendations from the Wildlife Crimes Penalties Review Group. Police Scotland will create a new Wildlife Crime Investigation Unit to support the existing network of wildlife crime officers in complex investigations.

In order to safeguard vulnerable species from illegal persecution, we will carry out a review of prevention measures including the operation of the Partnership Against Wildlife Crime and supporting Police Scotland in their work to target wildlife crime hotspots. We are prepared to introduce legislation where necessary.

We will consider the outcome of Lord Bonomy's review into whether existing legal controls on hunting with dogs provide the intended level of protection for foxes and other wild mammals, while allowing for the effective and humane control of these animals where required.

We will also protect animals by introducing a Bill in the first year to ban the use of wild animals in circuses in Scotland. We will continue our review of pet welfare, including consideration of the results of recent consultations on electronic training collars and tail docking of working dogs.

Scotland's marine environment supports a range of marine industries, such as oil and gas, fishing and marine renewables and it is crucial to balance the interests of those industries with the protection of the marine environment. Scotland's first National Marine Plan, published in 2015, provides a framework to manage those interests.

We have already delegated powers to our first Marine Planning Partnership in Shetland. This work will continue and we will designate up to 18 new protected areas, and deliver management measures for existing protected areas by the end of 2017.

We will also protect animals by introducing a Bill in the first year to ban the use of wild animals in circuses in Scotland

Wild fisheries are an essential part of the Scottish environment and economy. We will introduce a Bill during this Parliamentary session to underpin new management structures and establish the foundations for a more secure and sustainable future for wild fisheries.

We will bring forward salmon conservation regulations for the 2017 season. We will enable a more localised approach by moving current designation of fishery districts towards individual river level assessments. We will continue discussions about the designation of the haaf net fishery on the River Annan.

We will introduce a Bill during this Parliamentary session to underpin new management structures and establish the foundations for a more secure and sustainable future for wild fisheries


Email: Gavin Henderson,

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